How to Market in Tough Markets

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For producers in the eastern Corn Belt with a poor crop, plan B is going to hinge largely on insurance payments and hoping they have enough grain to fulfill forward cash contracts.

For producers with big crops this year, the decision-making should be very simple. The market is offering producers with a crop the most profitable year they’ve probably ever had in their life. Take advantage of it. For producers in that situation, it’s time to concentrate on the 2012 and 2013 crops.

Just keep another fact in mind: Market prices are good or bad based on a comparison. Don’t compare 2012 and 2013 prices to 2010 and 2011 prices. Markets will not likely be able to sustain these levels. Compare using a three-year average instead of the absolute top of the market.